Jerry Ellig

Research Professor

Photo of Jerry Ellig

 

Dr. Jerry Ellig is a research professor at The George Washington University Regulatory Studies Center. His research focuses on regulatory impact analysis, regulation of network industries, and performance management in government.

In 2017-18, Dr. Ellig served as chief economist at the Federal Communications Commission. He was a senior research fellow at the Mercatus Center at George Mason University since 1996.  Between August 2001 and August 2003, he served as deputy director and acting director of the Office of Policy Planning at the Federal Trade Commission.  Dr. Ellig has also served as a senior economist for the Joint Economic Committee of the U.S. Congress (1995-96), an adjunct professor in the George Mason University School of Law (2005-08), and an assistant professor of economics at George Mason University (1989-95).

Dr. Ellig has published numerous articles on government regulation and management in both scholarly and popular periodicals, including the Journal of Benefit-Cost Analysis, Journal of Regulatory Economics, Regulation and Governance, Public Choice, Journal of Empirical Legal Studies, Managerial and Decision Economics, Journal of Politics, Business & Politics, Antitrust Bulletin, Administrative Law Review, Federal Communications Law Journal, Texas Review of Law & Politics, Wall Street Journal, New York Times, Barron’s, and Washington Post.  His co-authored/edited books include Government Performance and Results: An Evaluation of GPRA’s First Decade, Dynamic Competition and Public Policy, New Horizons in Natural Gas Deregulation, and Municipal Entrepreneurship and Energy Policy.

He is a native of Cincinnati, Ohio and a graduate of St. Xavier High School. He received his B.A. in economics from Xavier University in Cincinnati, OH, and his Ph.D. and M.A. in economics from George Mason University in Fairfax, VA.

Download Dr. Jerry Ellig's Curriculum Vitae (PDF)

 

Content by Jerry Ellig:

 

Improvements in SEC Economic Analysis

August 19, 2020 | By: Jerry Ellig

Several D.C. Circuit decisions that remanded regulations to the Securities and Exchange Commission (SEC) between 2005 and 2011 provide a natural experiment that permits researchers to identify the correlation between judicial review, the quality of regulatory agencies’ economic analysis, and its use in regulatory decisions. SEC economic analysis improved substantially following the issuance of new staff guidance on economic analysis in 2012. Improvement occurred on all major elements that the guidance identified as important. The improvement occurred both on criteria that address “conceptual” economic analysis and on criteria that require quantification of benefits or costs to receive full credit. Although substantial room for improvement still exists, the court decisions appear to have motivated the SEC, in just a few years, to close the gap between the quality of its economic analysis and the average quality of economic analysis produced by executive branch agencies. This result holds implications not just for the debate about SEC economic analysis but also for the broader debate over the relationship between judicial review and regulatory impact analysis. It suggests that judicial review is likely to have a salutary effect on the quality of agency economic analysis.


Retail Electric Competition and Natural Monopoly: The Shocking Truth

May 20, 2020 | By: Jerry Ellig

This working paper is a draft of a chapter in Adam Hoffer and Todd Nesbit, Regulation and Economic Opportunity: Blueprints for Reform.

Regulated monopoly remains the dominant paradigm for electricity retailing in the United States. Scholarly research, however, clearly refutes the idea that monopoly is the most efficient market structure for retail electricity sales. Contrary to natural monopoly theory, no studies find that retail competition, per se, increased prices, although several studies find that flaws in market design have led to higher prices.


Statutory Delegation, Agency Authority, and the Asymmetry of Impact Analysis

February 26, 2020 | By: Jerry Ellig & Michael Horney

This article documents the diverse degrees of discretionary authority Congress grants US executive branch agencies. It then presents a case study that systematically compares the quality of impact analysis that informed legislative and regulatory decisions on positive train control, a technology mandated by statute in 2008.


Coproduction of Regulations Under the Administrative Procedure Act: How Close is the U.S. to a Classical Liberal Regulatory System?

December 16, 2019 | By: Jerry Ellig

Aligica et al. (2019) posit that a form of public administration founded in the classical liberal tradition should recognize value heterogeneity, which would create a need for coproduction of rules and polycentricity in the production of rules. Utilizing a dataset of 130 economically significant executive branch regulations proposed between 2008 and 2013, this paper assesses whether US regulators act in a manner consistent with the predictions of their theory. US federal agencies use several methods that could facilitate coproduction of rules by stakeholders. Statistical analysis finds that agencies are more likely to employ some stakeholder participation strategies for the types of regulations that may involve more heterogeneous values. However, there is scant evidence that the stakeholder participation strategies that agencies employ more extensively when values are more heterogeneous are associated with consideration of a wider variety of alternatives. There is no evidence that agencies consider a wider scope of alternatives for regulations that may involve more heterogeneous values. Therefore, value heterogeneity and stakeholder participation have not by themselves been sufficient to move the US toward a polycentric regulatory system.


Regulatory Impact Analysis and Litigation Risk

November 22, 2019 | By: Christopher Carrigan, Jerry Ellig, & Zhoudan Xie

This paper explores the role that the regulatory impact analyses (RIAs) that agencies are required to prepare for important proposed rules play in decisions by courts about whether these rules should be upheld when they are challenged after promulgation. The results suggest that better RIAs are associated with lower likelihoods that the associated rules are later invalidated by courts, provided that the associated agency explains how it used the RIA in its decision-making. When the agency does not describe how the RIA was utilized, there is no correlation between the quality of analysis and the likelihood the regulation will be invalidated. An explanation of the RIA’s role in the agency’s decision also appears to increase the likelihood that the regulation will be invalidated by inviting an increased level of court scrutiny, and as a result, the quality of the RIA must be sufficiently high to offset this effect.


David Versus Godzilla: Bigger Stones

September 12, 2019 | By: Jerry Ellig & Richard Williams

For nearly four decades, U.S. presidents have issued executive orders requiring agencies to conduct comprehensive regulatory impact analysis (RIA) for significant regulations to ensure that regulatory decisions solve social problems in a cost-beneficial manner. Yet experience demonstrates that agency RIAs often fail to live up to the standards enunciated in executive orders and OMB guidance. We suggest four managerial changes that could increase OIRA’s leverage.


Restoring Internet Freedom as an example of How to Regulate

June 3, 2019 | By: Jerry Ellig

Thomas Lambert’s How to Regulate contains some simple but critical pieces of advice for regulators: (1) Diagnose the problem before settling on a solution, (2) Compare the merits (benefits and costs) of alternatives, and (3) Recognize that regulators, like the rest of us, respond to the incentives created by the organization in which they are embedded. The FCC’s Restoring Internet Freedom order presents an example of how to apply those principles in practice.


 

OPM's Paid Parental Leave

September 9, 2020 | By: Joseph J. Cordes & Jerry Ellig

We write to express our concern about two elements of the Office of Personnel Management’s economic analysis of the rule. First, OPM’s discussion of benefits should be clarified and made more complete. Second, OPM classifies the value of salary and benefits associated with paid parental leave merely as a transfer from taxpayers. However, it is clear that the statute and the rule are intended to produce a real reallocation of resources toward child care and away from other activities. Therefore, an accurate assessment of the costs of the regulation should include these real resource costs, including the deadweight cost of taxation.


The FCC and Section 230

September 2, 2020 | By: Jerry Ellig

The National Telecommunication and Information Administration proposal includes several provisions that would narrow the scope of Internet intermediaries’ liability when they remove or restrict access to content provided by others. It would also require the intermediaries to disclose their content moderation policies in a form that is understandable by consumers and small businesses. Those two sentences of course do not capture all of the legal subtleties involved, and this comment takes no position on the legal issues raised by the petition. However, I believe that in deciding whether to propose a regulation in response to the NTIA petition, the Federal Communications Commission should be fully aware of the analysis required to identify the likely economic effects of the NTIA proposal and other alternatives the FCC may consider. One way or another, the NTIA proposal is likely to have economic effects that exceed the $100 million annual threshold and hence require a full benefit-cost analysis.


Reply Comment on Benefit-Cost Analysis at the STB

March 18, 2020 | By: Jerry Ellig

This reply comment is on the Surface Transportation Board's solicitation of information regarding the Association of American Railroads' petition for a rule on benefit-cost analysis, and it addresses several concerns about the suitability of benefit-cost analysis for STB proceedings that stakeholders raised in earlier comments.


STB Petition to Consider Benefit-Cost Analysis

January 31, 2020 | By: Jerry Ellig

On July 8, 2019, the STB decided to delay consideration of a petition asking the board to adopt a procedural rule that would require benefit-cost analysis in certain board rulemakings. On November 4, 2019, the STB solicited further information from the public about specific methods that could be used for benefit-cost analysis of rules related to economic regulation of freight railroads. The STB is prudent to explore methods for improving its economic analysis of regulatory proposals—as several other independent agencies have done in recent years.


FDIC's Framework for Analyzing the Effects of Regulatory Actions

January 29, 2020 | By: Jerry Ellig

The FDIC is wise to use Circular A-4 as a template for economic analysis. The analytical approaches in Circular A-4 are critical for determining whether a regulation under consideration is likely to produce more good than harm. The principles in Circular A-4 are also general enough that they can be applied to banking and financial regulation. The Securities and Exchange Commission’s (SEC’s) experience with an analytical framework based on Circular A-4 demonstrates that the framework is practicable and can produce a noticeable improvement in the quality of economic analysis.


STB's Rate Review and Market Dominance -- Reply Comment

January 13, 2020 | By: Jerry Ellig

This reply comment addresses issues raised during two recent proceedings where the Surface Transportation Board proposed a streamlined approach to assessing whether a railroad has market dominance and a final offer process for small rate disputes.


STB's Railroad Revenue Adequacy

December 02, 2019 | By: Jerry Ellig

The Surface Transportation Board will hold a hearing on December 12 to discuss recommendations from the STB's Rate Reform Task Force. This comment addresses several of the task force's proposals, and provides additional recommendations for the STB to improve its revenue adequacy regulations.


STB's Market Dominance and Final Offer Rate Review

November 06, 2019 | By: Jerry Ellig

The two rulemakings this comment addresses are the Surface Transportation Board’s (STB’s) latest efforts to develop simpler and less costly rate complaint processes. These two proceedings provide an excellent opportunity for the STB to “test drive” the framework for benefit-cost analysis that is most commonly employed by federal agencies: the analytical principles and requirements articulated in President Clinton’s Executive Order 12866 and OMB Circular A-4. The most common and accurate term for this type of analysis is “Regulatory Impact Analysis” (RIA), because a full RIA involves more than just estimation of benefits and costs. This comment briefly explains the RIA framework and demonstrates how it could be used to answer key factual questions the STB must answer in order to accomplish its statutory goals.


IRS's Safe Harbor Notice on State and Local Tax Credits

July 10, 2019 | By: Jerry Ellig

The IRS seeks comment on a guidance notice that allows taxpayers to count contributions for which they received a state or local tax credit as a payment of state or local taxes, subject to the $10,000 SALT cap. This notice corrects a problem created by a regulation issued on June 11, 2019, which prohibits taxpayers from taking a charitable deduction if they received a state or local tax credit in exchange for the contribution. Without this notice, the regulation is overly broad, because it takes away the deduction for taxpayers below the SALT cap even though they are not a cause of the tax avoidance problem the regulation seeks to solve.


IRS Qualified Business Income Deduction

April 08, 2019 | By Jerry Ellig & Jeffery Kaufman

The 2017 tax reform allowed investors in real estate investment trusts (REITS) and publicly-traded partnerships (PTPs) to take a tax deduction equal to 20 percent of qualifying distributions from REITs and PTPs. The Internal Revenue Service seeks comment on whether investors should also be allowed to take this deduction if they own REITs or PTPs through a regulated investment company, such as a mutual fund. Unfortunately, the IRS did not conduct an economic analysis sufficient to determine which choice is economically efficient. A complete analysis would first assess whether the deduction is economically efficient; building on that analysis, the IRS could then determine whether extending the deduction is efficient. We provide some illustrative calculations that point the way toward a more complete analysis.


IRS's Proposed Rule on SALT Credits

October 12, 2018 | By: Jerry Ellig

The Internal Revenue Service has proposed a regulation that would prevent all individual taxpayers from claiming a federal charitable deduction if the taxpayer received a state tax credit equivalent to more than 15 percent of the donation. This comment explains why the proposed regulation is much broader than necessary to address the real problem the IRS seeks to solve: state tax credit programs designed explicitly to aid taxpayers in avoiding the cap on deductibility of state and local taxes.


 

A Model for Bipartisan Cooperation: Trucking and Rail Regulatory Reforms

October 7, 2020 | By: Jerry Ellig

This year marks the 40th anniversary of the Motor Carrier Act and the Staggers Rail Act, which substantially deregulated prices, entry, and exit in surface freight transportation. These reforms are noteworthy because they produced enormous consumer benefits, there is a strong scholarly consensus about their effects, and they enjoyed significant bipartisan support. The GW Regulatory Studies Center will host an online symposium to commemorate these regulatory reforms and draw lessons for the future.


Improvements in SEC Economic Analysis

August 19, 2020 | By: Jerry Ellig

Ellig finds that the SEC, in just a few years, has closed the gap between the quality of its economic analysis and the average quality of economic analysis produced by executive branch agencies.


Regulatory Impact Analysis for Financial Regulations

July 21, 2020 | By: Jerry Ellig

Financial regulatory agencies can produce useful economic analysis to inform regulatory decisions if they keep three principles in mind: (1) Focus on regulatory impact analysis (RIA), not just benefit-cost analysis (BCA); (2) The analysis is not the decision; and (3) Build institutional capacity to support objective analysis.


Improving Economic Analysis by Reorganizing Agencies’ Economists

June 30, 2020 | By: Jerry Ellig

An Administrative Conference of the United States recommendation could help agencies better organize their economics staffs.


The Social Media Executive Order and the FCC

June 8, 2020 | By: Jerry Ellig

President Trump’s executive order on social media instructs the secretary of commerce to petition the Federal Communications Commission (FCC) for a rulemaking that could limit social media companies’ exemption from lawsuits if they remove or restrict political speech because they disagree with the speaker’s viewpoint.  Any such rulemaking would raise formidable economic and analytical issues as well as legal issues. This commentary outlines the questions FCC analysts would have to address just to determine whether a problem exists that regulation might solve.


Epistemic Lessons from Economic Regulatory Reform

February 5, 2020 | By: Jerry Ellig

Ellig offers three lessons learned major regulatory reforms over the past forty years; 1. Intentions do not equal results, 2. Facts are stubborn things, and 3. We can make progress together on policy if we focus on evidence.


Better Economic Analysis Can Reduce Regulators’ Litigation Risks

December 19, 2019 | By: Jerry Ellig

Legal scholars such as Cass Sunstein, Jonathan Masur, and Eric Posner argue that federal regulatory agencies will face increasing pressure from courts in the coming years to produce high-quality economic analysis to inform decisions about regulations. While some are concerned about courts’ capability to review economic analysis, the fact is that courts are already doing it. Several recent research projects shed light on the relationship between the quality of an agency’s economic analysis and the risk that a regulation will be overturned in court.


Rail Regulators Ponder Benefit-Cost Analysis

November 18, 2019 | By: Jerry Ellig

Although regulatory impact analysis would certainly not automate STB regulatory decisions, it would provide a coherent and organized framework for discovering and presenting information about the likely consequences of regulatory alternatives.


Bigger Stones for David: Tools to Give OIRA More Leverage in Regulatory Review

October 02, 2019 | By: Jerry Ellig

Regulatory review of agency rulemaking activity through the Office of Information and Regulatory Affairs should be linked to each agency’s strategic planning, and carry budgetary consequences. This will help agencies to more clearly define their goals, achieve their objectives, and reward positive results.


Francisco Franco Still Dead, Naked Alcohol Protectionism Still Unconstitutional

July 03, 2019 | By: Jerry Ellig

The Supreme Court ruling in Tennessee Wine & Spirits Retailers Association v. Thomas confirms that the U.S. Constitution does not allow states to engage in naked economic protectionism just because the product is alcohol.


IRS Rule on Charitable Deductions: A Worthy Goal, a Skillful Fix, but Surprisingly Thin Evidence

June 17, 2019 | By: Jerry Ellig

The IRS prohibits individual taxpayers from deducting charitable contributions on their federal taxes if they received a state or local tax credit in exchange for the contribution, but allows them to count such donations as state or local tax payments subject to the $10,000 cap on state and local tax deductions.


Statutory Clarity and Judicial Review of Regulatory Impact Analysis

April 29, 2019 | By: Jerry Ellig -- Originally posted in The Regulatory Review

Precise statutory language corresponds to better benefit-cost analysis and more consistent judicial review.


Electric Utility Competition — In South Carolina?

January 28, 2019 | By: Jerry Ellig

Research professor Jerry Ellig participated in an educational forum hosted by the South Carolina Small Business Chamber of Commerce to discuss his research on electric utility market competition. This commentary provides a summary of Ellig's presentation, and an overview of the reform ideas presented by his co-panelists.


Supreme Court to Hear Arguments on State Alcohol Protectionism This Month

January 9, 2019 | By: Jerry Ellig

Next week the US Supreme Court will hear arguments on the constitutionality of a Tennessee law that requires individuals to live in the state for two years before they can obtain a permit to sell alcohol. I signed onto an amicus brief by law and economics scholars that explains why this law is a paradigmatic example of protectionist legislation that provides concentrated benefits to well-organized groups while dispersing the costs among a much larger group -- consumers.


Now Available: A Concise Explanation of the FCC’s Economic Analysis on Net Neutrality

November 19, 2018 | By: Jerry Ellig

 

Understanding the FCC's economic thinking behind its Restoring Internet Freedom order, which repealed and replaced Net Neutrality, has not been easy to decipher for anyone interested in the subject. In this commentary, and a brand new journal entry, research professor and former FCC chief economist Jerry Ellig provides a concise explanation of the agency's rationale behind the order, and points out its previous disregard for economic analysis.


FCC Clears Last Hurdles to Creation of Economics Office

October 25, 2018 | By: Jerry Ellig

 

The Federal Communications Commission has just announced approval for it to organize an Office of Economics and Analytics. Jerry Ellig - former FCC chief economist and current Regulatory Studies Center research professor - discusses what that means for the independent agency's rulemaking process.


IRS Tax Credit Regulation: Too Much SALT?

October 15, 2018 | By: Jerry Ellig

 

The Internal Revenue Service (IRS) has proposed a regulation that would prevent all individual taxpayers from claiming a federal charitable deduction if the taxpayer received a state tax credit equivalent to more than 15 percent of the donation. This comment explains why the proposed regulation is much broader than necessary to address the real problem the IRS seeks to solve: state tax credit programs designed explicitly to aid taxpayers in avoiding the cap on deductibility of state and local taxes.


 

Wall Street JournalThe Misguided Antitrust Attack on Big Tech, by Phil Gramm & Jerry Ellig


Wall Street Journal‘Big Bad Trusts’ Are a Progressive Myth, by Phil Gramm & Jerry Ellig


Washington PostHere's How Federal Agencies Can Write More Effective Regulations - And Win Regulatory Battles in Court, by Jerry Ellig & Catherine Konieczny


The Post & CourierSelling Santee Cooper: Competition Should Be Part of the Plan, by Jerry Ellig


Real Clear PolicyIll-Considered Tax Credit Regulation May Put the Squeeze on Charities, Taxpayers, by Jerry Ellig